Iowa Small Business Statistics
You've probably been thinking of Iowa as a farming state for a long time and believe that other industries are poorly flourishing here. But in the last few years, manufacturing has been growing rapidly here.
This includes the production of household chemicals and heavy equipment. Both small companies with fewer than 20 employees and larger LLCs, which can have 300-400 employees, are being registered in this area.
Startups are looking to register companies in Iowa to take advantage of the small business benefits offered by the local government. Also, many people are attracted by the opportunity to save on rent and the generally low cost of living. The difference from the national average can be as much as 10%.
It is also an attractive place to start a foreign business. Moreover, not only Americans think of this state that way. More than 10,918 immigrant entrepreneurs are registered here.
However, all business owners in this state face a high corporate tax rate. This has a tangible impact on the speed of business development in Iowa.
That being said, Iowa is considered one of the highest-performing states in terms of small businesses. This ultimately affects the active growth of the U.S. economy as a whole.
Iowa Small Business: Key Info
- There are more than 270,000 small companies registered in Iowa;
- SMEs make up over 99% of all companies in the state (in Iowa, any firm with fewer than 500 employees is considered a small business);
- The number of companies in the state grows every year:
| Year | Number of Companies |
|---|---|
| 2016 | 264,384 |
| 2017 | 266,382 |
| 2018 | 267,733 |
| 2019 | 270,484 |
| 2020 | 272,555 |
- The number of companies closing in the state is less than the number of new businesses. The average net increase is 250 entities per year;
- As the Iowa Secretary of State reports, in 2021, business owners have broken all records in this locality for the number of companies registered. That's more than 33,260 new ones between July 1, 2020, and June 30, 2021;
- In terms of the workforce, companies can be divided this way:
| Number of Employees | Number of Companies |
|---|---|
| No employees | 212,333 |
| 1-19 employees | 54,049 |
| 20-499 employees | 7,587 |
- To register an LLC in Iowa, you only need to file Articles of Organization and pay a $50 fee;
- An additional expense for entrepreneurs is the required services of a registered agent;
- There is no franchise tax in the state;
- Corporate tax is progressive. If your income is less than $25,000, the rate is 6%. But if your income exceeds $250,000, the rate is as much as 12%;
- Among small business owners in Iowa, 43.3% are women (94,759 firms) and 56.7% are men (149,277 companies);
- Hispanics own 2.5% of all businesses in the state;
- Other minorities own 4.5% of the companies;
- The largest number of businesses are registered in these industries:
| Industry | Number of Employees |
|---|---|
| Construction | 34,898 |
| Retail Trade | 30,025 |
| Real Estate and Rental and Leasing | 27,930 |
| Professional, Scientific, and Technical Services | 27,606 |
- The smallest number of companies are registered in such industries:
| Industry | Number of Employees |
|---|---|
| Mining, Quarrying, and Oil and Gas Extraction | 109 |
| Utilities | 234 |
| Management of Companies and Enterprises | 250 |
| Information | 2,980 |
- The field of international trade has a large presence in the state. There are more than 2,800 exporters.
Iowa Small Business: Employees
- The unemployment rate in Iowa is decreasing rapidly. Last year, it was 4.1%, and this year, it is down to 2.7%;
- There are a total of 652,496 small business employees in the state;
- The number of job openings is also on the rise. In 2019, small firms added 93,316 jobs and closed 90,811 vacancies. There was a net increase of more than 2,500 jobs in the year;
- Women make up 47.4% of the state's workforce, while men comprise 53.6%;
- Hispanics make up 5.7% of Iowa's workforce, and other racial minorities – 7.8%;
- Companies with fewer than 100 employees offer the largest number of new positions.